Covenant Lite Loans Make A Resurgence
The Commercial Observer (NY) reports covenant lite loans have returned to the bond market as competition for debt heats up, with borrowers successfully “pushing back on the protective covenants that keep lenders sleeping easy at night.” At a recent industry event, Voya Investment Management Head of Real Estate Finance Greg Michaud joined other panelists discussing the rise of covenant lite deals, which has resulted in some investors losing out on deals because they were uneasy about the lack of safeguards. Michaud said that Voya has been actively pursuing deals in the multifamily housing sector, though competing against companies like Freddie Mac and Fannie Mae has proven challenging.